The image you indicate is not in my version. I've attached the image. Neither button, the brush (clear text chat) and EALL (erase all from room screens) deletes the text except in the current session. When I logout and back in, the text is still there. I would think there would be a way to remove this without having to go to the red5 subdirectory that stores this info.
Okay, so I figured out what's happening. The setting I need to change is in the avc_settings.php file, specifically the historylength setting. There is one for admin, one for members. If I set to 0, no text chat when I enter the room is visible. Thanks for your patience with my questions Virgil. Now I just have to figure out how to show custom avatars in the avatar window. Thanks.
So I found the solution to the custom avatar not showing problem in an old post from 2013 in the vbulletin 4.2 category. Post #12,
http://nusofthq.com/forum/index.php?/topic/1868-vbulletin-420-integration-of-avatars/. Though I have ver 3.8.4, this worked. This was my last known issue.